Debate develops over direction of Czech health care sector

Health looks set to be one of the political battlegrounds in upcoming Czech elections scheduled to take place in October. Some of the lines are already being drawn and that’s just between the two leading government parties, the Social Democrats, and ANO. And while the Czech healthcare system appears to be functioning pretty well, there are clear signs of strain and questions about where future financing will come from and whether the tried and tested framework should stay the same.

Photo: Filip Jandourek, Czech Radio

Most experts would probably agree that the Czech health care system is in fairly good shape. But while the framework has not undergone any major surgical changes over the past decade or so, it is showing signs of age and strain with politicians and experts giving their analysis of what the ailments and cures could be.

Two instances from the last week give some idea of where the problems are. The first is figures from the Institute of Health Information and Statistics for the last year available, 2015.

After years on the slide, they show Czech death rates on the rise in that year by around five and a half thousand on 2014. And the slice of the Czech population in the so-called active range between 15 and 64 shrunk again to around two-thirds of the overall total. The young and elderly are bigger users of the health care system.

Another snapshot of the situation, Czech regional hospitals are complaining at the start of the year that they simply cannot find the money to pay the 10 percent pay rises in the sector demanded by the government.

The bare bones of the Czech healthcare sector are fairly simple. The overwhelming majority of it, around 83 percent, is provided by public authorities with very little sourced out to the private sector. There is one major health insurance company, VZP, and a few smaller ones but competition does not really exist between them since they are providing almost identical packages of services.

“We have a system that is not so dependent on economic upswings or downswings.”

Jan Alexa is an analyst with the international market intelligence company IDC. At a recent Prague seminar on financing of healthcare, looking at local and European experiences, he picked out the strong and weak points of the existing Czech model.

“The Czech health care system is relatively resilient in terms of its ability to maintain some form of stability in times of financial crisis. We have a system that is not so dependent on economic upswings or downswings. This is the first strong point. The second is the equality in access to services. We have one of the best levels of equality in access to services in Europe and perhaps in the world so that is something that we can be proud of.”

The Euro health care consumer index places the Czech Republic 13th out of 35 countries. The Czech Republic is placed ahead of Britain and of all the other countries in Central and Eastern Europe. Ahead are countries, such as the Netherlands, Switzerland, Norway, Sweden, Luxembourg, and Germany, all, in absolute terms spending a lot more on health care than the Czech Republic. The Czech Republic on 760 points is just 14 points short of Austria. The index is composed of 48 indicators covering the likes of patient rights and information, access to care, treatment outcomes and range and reach of services.

Jan Alexa, photo: archive of IDC

And many of those countries out ahead in the index are spending a lot more of the nation’s wealth on health services. The Czech Republic is spending around 6 percent of GDP on public funded healthcare with many others spending around 8 percent or more. So, the Czech system comes across as fairly cheap and might have the advantage that there is some room for extra spending if more burdens are put upon it.

On the minus side, according to Alexa is that fact that a lot of health policy appears to be made on the hoof by the politicians in charge with little long-term planning for how it should evolve.

“The first obvious weakness is short-termism. This is something which is very common across all the public sector and its probably related more generally to the inability of politicians to come up with some unifying vision. The second weak point is the inability to connect health care to some other areas such as social care and to a lesser extent education. We are not really managing properly this border line area between social care and health care.”

At the Prague seminar it was outlined how other top European health providers, such as the Netherlands and Switzerland, have developed a lot more competition between the health insurance companies. In Switzerland, the competition means that some insurance companies have gone to the wall or been taken over. That is a far cry from the Czech situation where the insurers are bound up in so many regulations that there is little room to make innovations or widen the offer to contributors and would be patients. Jan Alexa again:

“The Czech health insurance funds are really not competing properly now.”

“The Czech health insurance funds are really not competing properly now because there is a very limited scope for competition. It would be certainly beneficial to introduce some new policies enabling them to differentiate themselves and offer more competition.

Those comments chime with the comments that have and are being made by finance minister and ANO leader Andrej Babiš who has attacked the public health care system for being too monolithic and the insurers for not being allowed to broaden their offer. Finance minister advisor Adam Vojtěch told the seminar that he personally favoured Czechs being given the chance to choose whether they wanted to pay more directly or through insurance contributions for wider or higher level services in a way that is not possible now.

There has been some, albeit, limited experimentation in the Czech health care sector already. The centre-right government introduced minimal charges were for visits to doctors and stays in hospitals, these have been scrapped as one of the main election planks of the current biggest government party, the Social Democrats. Charges are still as a matter of course made for selected drugs and for most dental treatments.

The jury seems to be out on what the introduction and removal of charges actually meant in the Czech context. The biggest health insurer, VZP, said visits to doctors did not go up appreciably when the charges for visits were removed. The Ministry of Health warns though that full figures were not kept of the situation before and after and it’s therefore difficult to draw conclusions.

Photo: Khalil Baalbaki

In Norway, charges for some services, such as consultations for teenagers, were scrapped leading to a rapid rise in their use, especially by teenage girls becoming worried about birth control. And they were reimposed in other areas, such as physiology, where it was discovered that the charges helped reduce the over use of services by some people who were actually crowding out those patients most in need.

Chris James is an expert of the health division of the so-called club of rich countries, the OECD. His broad view is that charges are a useful tool for governments to pay for health care but that they should be used with care.

“If you have very high out of pocket payments, people will not be able to access car when they need it. That’s the starting viewpoint. At the same time, I’m saying that you don’t remove them completely. They have a role, but it’s always going to be a secondary role in the financing of the healthcare system.”

In one way, James says forcing patients to make payments to alter their uptake of health services is a bit strange since in many cases it is the decisions of doctors, whether to prescribe a certain type of drug, carry out a certain test, or recommend a given treatment, that will be really decisive in how much that service or care is going to cost.

“It’s going to be, well, physicians who say you may as well have this test because, well, it’s not harmful, it might have some benefit, but I get reimbursed for that test so have it anyway. Whereas if you have a payment system which is based more on capitation or diagnosis related groups (DRG) you have more chance of controlling costs because then the physicians will think more, well, irrespective of whether I suggest to the patient to have this test, the payment I get does not automatically increase for that. So, yes, really thinking about how you pay the provider, all countries are doing this already.”

“If you have very high out of pocket payments, people will not be able to access car when they need it.”

He adds that there are many other avenues which could be pursued for making health care more effective.

“Cost sharing is one tool and the tools would be looking at ways to shift services from hospitals to primary care; revisiting how health care professionals are used, making better use of non-physicians, nurse practitioners and nurses and giving them more responsibility. These are all ways of reducing costs that can have a big impact on cost containment but without negatively affecting access to care.”

But as Jan Alexa points out, Czech health care has been very weak in the past and often unsuccessful when trying to find different ways of doing things or looking to use new technology in care, such for example as digital health cards or the use of a wide range of new and upcoming applications which allow patients in many cases to test themselves before going to their doctor.